Experienced entrepreneurs look to markets for ideas.
Specifically they are looking for inefficiencies or gaps in what's currently being offered versus what's demanded.
This era has really been the rise of independent CPG brands as we’re all exploiting inefficiency in the market.
Perhaps the most important.
**The major CPG companies have almost no relationship with their customers.
They stock the shelf and that’s it.
The relationship used to be tied at the local retail level. With no other options to get their products, the customer would have a relationship with store.
Now with eCommerce there are endless options.
Natural Stacks is a good example of exploiting inefficiency in the market. We have a relationship from the first time someone clicks an ad or views a piece of content to the time they sign up for a subscription. And we care, a lot about the relationship and do everything we can to keep the person as a customer and to have them share their experience with their friends.
So a good question to ask yourself is, “Does my business idea exploit an inefficiency in this market?”
Examples of market inefficiencies can include:
- Slow delivery
- Lack of cheap options
- Lack of expensive options (rich people buy more than poor people)
- No “local” option
- Lack of customer relationship
- Painful to do or learn
*I really like the painful to do or learn part.
It’s what has lead to the rise of “productized services” which is a product you purchase at a flat price and the business provides a service.
To learn more about productized services listen to these podcasts from the TMBA.
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